Rethink Technology Research

By Thomas Flanagan

Published 25th October 2018

Android TV has just infiltrated the Korean TV market with a landmark deployment at one of the largest operators there, SK Broadband, running on a new Arris set top. The third placed network there LG+ has been using Android for the past 2 years. However all three major Korean operators have been at loggerheads to own the voice space, each developing their own AI-based voice assistants and advanced features, and we expected Korea to be one of the least penetrated Android TV markets.

In January 2019, SK Broadband will roll out its debut Android set top, a 4K device combining OTT, linear and on-demand video, integrated with Chromecast, YouTube and the Play Store. This does not appear to be an Android TV Operator Tier project, instead we understand SK Broadband has based its new offering on AOSP, meaning much more control over the ecosystem. An Operator Tier launch in Korea could therefore be just around the corner, once SK Broadband gets a taste for Android-based TV. Arris’ response – “Unfortunately this information is unavailable.”

By selecting Arris, it looks like SK Broadband is about to replace Kaon devices in the field, currently deployed for its B tv IPTV service, with more modern set tops from Arris which offer the enhanced processing power required for bringing 4K experiences and enhanced discovery features.

Missing from the announcement, however, is any mention of voice functionality, although we are almost certain SK Broadband’s AI-powered smart assistant Nugu will be accessible via the new Arris devices. We say that because back in February, SK Broadband launched a new IPTV service based on Nugu after many years of development, building on the momentum of having shipped around 10,000 of its voice-controlled smart speaker devices every month since early 2017, including a full integration with SK Telecom’s TV service B tv. Combined with its other mobile IPTV service Oksusu, SK Broadband has around 14 million TV subscribers.

“Our partnership with Arris has been instrumental in making this dream come true. Together, we’re transforming TV for millions of subscribers across Korea,” said Sang Bum Lee, CTO, SK Broadband. SK Broadband is also a broadband product customer of Arris, using its E6000 Converged Edge Router.

SK Broadband was one of a duo of Asia Pacific announcements from Arris this week, the other at Australian pay TV operator Foxtel. We were pleasantly surprised to discover both are pure TV deployments rather than networking gear installations as we have come to associate more and more with Arris.

Foxtel, part-owned by Telstra and News Corp, has deployed its new Arris-made iQ4 set top, again with a focus on bringing 4K content to subscribers. It combines broadcast satellite, terrestrial and IP capabilities, with a powerful new processor (we have inquired as to specifically which), with 802.11ac WiFi, a 1,000 GB hard drive, and HDR support.

Had Arris never acquired Pace, Foxtel would be a customer first for the US company, but the operator has used Pace set tops for a number of years. Interestingly, the Pace-made iQ3 predecessor was notoriously glitchy – to the extent Foxtel had to totally rebuild the device after suffering a bombardment of complaints. That makes Arris’ reselection a slight surprise, although multiscreen software firm Massive Interactive was also involved with the iQ3 project, as well as with designing the Foxtel Play streaming service, but it seems this contract has fallen.

We reached out to Massive for clarification and were told Foxtel is using the same UI for the iQ4 as it did with the iQ3, which was designed by Massive. “The only major difference between the iQ3 and the iQ4 is the ability to support the 4K channel. For the foreseeable future, we plan to advance both products with exciting new features at the same time. Massive designed the GUI for iQ3, but was never involved in any of the software development. Its engagement was design only – customer research, establishing the UI vision, and then the UI/UX design of the new interface for the iQ3 box,” the company told Faultline Online Reporter.

Massive shouldn’t take it personally as Foxtel has been an uninspiring player in video services. Telstra recently blamed Foxtel’s 18,000 subscriber exits for its revenue declines and Foxtel has even attempted OTT video to no avail, having shut down the SVoD service Presto in early 2017 after reaching just 353,000 people in 142,000 homes before it was closed down.

Foxtel is keen to push the idea that its new iQ4 set top is an ideal environment for live sports, which can also be read as a strategy to reduce churn and maintain a solid ARPU. It talks about a sports fan targeting feature called Team-Link, which provides automatic links to sports and team content. Initial customer response has been “overwhelming,” Foxtel claims.

The iQ4 is not an Android-based device but voice functionality was again a surprise absentee. Foxtel desperately needs to add voice to its pay TV offering, currently only offering the separate Android TV-powered Foxtel Now streaming device with voice remote.

This is a significant omission and is why the iQ4 will simply be just another brick in the wall of failed anti-cord cutting initiatives rather than a revolutionary video service. It won’t be long before Foxtel is back to the drawing board – likely meaning more business for Arris.